REMARKS BY THE PRESIDENT
ON THE BENEFITS OF CHINA PNTR TO AMERICA'S FARMERS
Hauer Farm Barnyard
Shakopee, Minnesota

2:35 P.M. CDT

THE PRESIDENT: Thank you. Well, first of all let me say I thank
you all for coming out today. And I'm glad the weather made it easier
on us.

I want to thank Terry and Kitty and Gene Hauer for welcoming us to
their farm. I think we ought to give them a big hand. We have invaded
them -- (applause.) We managed to find enough unplanted space that I
don't think we're taking their income away, but we certainly have
invaded them today.

Dallas, thank you for your introduction, and for your example.
Secretary Glickman, thank you very much for the work you're doing, not
only on this issue, but on so many others, to help the farmers of
America. And I want to echo what you said about David Minge. He's a
wonderful person. I've loved working with him these years I've been
President. He is a straight shooter -- although he never tells me any
of those Norwegian jokes he's always telling Glickman -- (laughter) --
so I expect to get my quota before I leave.

But you should know that he is an extraordinarily attentive
representative for you. I don't even know how many times he's mentioned
some specific thing of importance to the people of this district and the
people of Minnesota. But if everybody worked on me as hard as he has
the last seven years, I wouldn't get anything else done, because he
really does a good job for you. (Applause.)

I want to acknowledge in the audience today the presence of your
Lieutenant Governor, Mae Schunk; the Attorney General, Mike Hatch;
Treasurer Carol Johnson; your state Ag Commissioner, Gene Hugoson -- I
think that's the right pronunciation -- and the Mayor of Shakopee, John
Brekke, and his wife and beautiful daughter came out to the airport and
met me. And I have here, somewhere, a beautiful crayon drawing she made
for me -- (laughter) -- which I'm going to take back to the White House
and save as a memory of coming here. It was really beautiful.
(Applause.)

I want to thank Bob Bergland, also, as Dan Glickman did. And I
understand the former governor of North Dakota, Alan Olson is here.
Welcome. I thank you for coming over.

But I want to say a special word of appreciation to a man who's
been my friend for 25 years and one of my favorite people in the whole
world: our former Vice President, your former senator and my former
Ambassador to Japan, Walter Mondale. Thank you for being here.
(Applause.) This is so nice. I spent most of my early life listening
to him speak, I'm just trying to get even now. (Laughter.)

I also want you to know that I brought with me two representatives
of American agriculture today, when I came in on Air Force One: Scott
Shearer with Farmland Industries, Nick Giordino of the National Pork
Producers, and Susan Keith of the National Corn Growers, and they're out
there working to help us; I thank them. (Applause.)

I want to also say to the people who are here from New Ulm, I'm
sorry that I couldn't come out to your community. I hope you'll give me
a rain check. What really happened was -- you know, politicians always
give you some sidewinding excuse. Well, I'll tell you what really
happened. What really happened is, I've got to go back to work in
Washington tonight, and I have to get back there an hour and a half
earlier than I had originally thought I had to be there. I'm glad I got
to come to the Hauers' farm, and I hope I get to come back there.

We have a community in my home state of Arkansas called Ulm, it's
near Almyra, which is near Stuttgart -- (laughter) -- which is near
Slovak. (Laughter.) And they grow rice down there.

I'm glad to be back in Minnesota. I was in St. Paul last week, at
America's first charter school, on my education tour. And I'm coming
back in a couple weeks to speak at Carleton College. If I come anymore,
you'll make me pay taxes here, but I've had a good time. (Laughter and
applause.)

I'd like to also acknowledge somebody who can't be here today, but
somebody I really want to thank. Last week we had an astonishing event
at the White House, with President Carter and President Ford, and
virtually every living former Secretary of State, former Secretaries of
Agriculture, former Trade Ambassadors, former Secretaries of Defense,
National Security Advisors, two former Chairmen of the Joint Chiefs of
Staff. A whole history of the last 50 years in America was represented
in the White House that day -- except for Vice President Mondale's
predecessor as Ambassador to Japan, Mike Mansfield, our former Senate
Majority Leader, he's 98 years old now. When he was 15 he lied about
his age to get into World War I. (Laughter.) He's from Montana and
he's about -- he would give a speech about as short as the one Terry
gave today. (Laughter.) Sort of consonant with coming from the
northern part of the United States.

But when we swore Fritz in, Mike Mansfield came and I said, you
know -- he was then, I think, 91 or 92 -- I said, you know, he walks
four miles a day. And Mansfield stood up in the back and he said, five.
(Laughter.) So when he was 98 I said, Mike, are you still walking every
day? He said, yeah, but I'm down to two miles a day. So I figure if we
could all walk two miles a day at 98, we'd be doing pretty well.

I also want to thank your governor, Jesse Ventura, who was there.
He was the only sitting governor who came. And he's been just great to
support this initiative and I'm grateful for him. It's good for you and
it's good for America. He's not a member of my party, he didn't have to
do it -- and it meant a lot to me that he showed up. I hope that it
will mean something to you, too. (Applause.)

When my staff was boning me up on getting ready to come here and
briefing me about the history of this area, I learned that the first
citizens of Shakopee were pioneers -- Shakopee, I'll get it right --
were pioneers in more than one sense. Way back in the 19th century they
were already trading with China. China was then the biggest and richest
fur market in the world, and many of the pelts they bought came from
here, from the shores of the Mississippi and Minnesota Rivers. They
found markets in China.

Then trade was a small, though interesting part of your past. It's
going to be a much bigger part of your future, one way or the other.
That's why I wanted to come here to talk about expanding trade in China,
what it means for farmers like you, for states like Minnesota -- and
even more important than that, for the future of our children and
America in this new century.

In less than two weeks, Congress will vote on whether to provide
permanent normal trading relation status with China. Now, PNTR, that's
pretty arcane-sounding. But what it means, as you've already heard, is
that China will join about 130 other countries with whom we have trading
that is governed by international rules of trade, plus whatever specific
agreements we have with them.

In 1979, when President Carter and Vice President Mondale and Bob
Bergland were involved in opening our relationships with China, we
signed a trade agreement. And ever since then -- and 21 years, now,
every year -- we have granted them what used to be called
most-favored-nation, but really was normal trading relations. We did it
on an annual basis. And the idea behind doing it on an annual basis
was, we knew we had big differences with the Chinese. They were a
Communist country; we were a democracy. They had labor, human rights
and religious rights practices with which we did not agree. We were
trying to continue to work with them to resolve their differences with
Taiwan on a peaceful basis. And it was thought that the Congress
reviewing this every year would give Congress -- and through Congress,
the President, whoever that happened to be -- some way of reviewing
where we were with China; whether it was in our larger national
interests, as well as our economic interests, to review this every year.

So now, I am proposing that we give them permanent normal trading
status and let them come into the World Trading Organization, where
they'll be governed by the same rules that govern us and all the other
countries that are in it. And I came to tell you why I think we ought
to make that change.

The biggest benefit, as you have heard from Secretary Glickman,
will probably go to the agricultural sector, in economic terms. One out
of every three American acres grows exports. We are the world's largest
exporter of agricultural products. During the last five years, in spite
of the Asian financial collapse, and the terrible thing it's done to
farm prices, we've still seen our exports nearly double. If you look at
gross cash receipts, trade means about twice as much to America's
farmers as it does to the economy as a whole.

Minnesota is third in soybean exports and production, fourth in
corn -- feed corn -- seventh in overall agricultural exports. In 1998,
Minnesota sold $2.4 billion in agricultural products to foreign markets,
$316 million to China -- more than twice what you sold in 1993, when I
became President.

As Secretary Glickman described, the magnitude of the Chinese
market virtually defies the imagination. There are, at one point, 1.3
billion people in China. It's no wonder already China consumes more
pork than any other nation. It is also the world's largest growth
market for soybeans and soybean products. When I was governor of
Arkansas, back 15, 16 years ago, I used to go to Taiwan, and Taiwan was
our biggest export market, they have 17 million people. And since the
Chinese people are the same, if you extrapolate from 17 million to 1.3
billion, it's almost incalculable what this could mean for soybeans.
The dairy consumption in China is going up as people's incomes rise.

Now, that's the way they are today, with a fairly modest per capita
income. It is projected that over the next 30 to 50 years, China will
have the biggest economy in the world. And obviously, as the people
grow wealthier and move more and more to the city, the markets will grow
-- not only because more people will be able to buy food, but the per
capita food consumption will go up.

What does it mean for China to go into the World Trade
Organization? It means they won't subsidize their farm sector as they
used to. They're already making adjustments -- planting less wheat and
less cotton, for example. There is no way the Chinese farmers can keep
pace with the growth of their own consumers. But America's farmers can.
And Congress can give you the chance to do so. But only if it votes for
permanent normal trading relations. And I want you to understand why:
because in order for the members of the World Trade Organization to let
China in, and then to benefit from whatever trade concessions China
makes -- and they've made the most in their agreement with us -- every
one of the members has to agree to treat China like a member. So if we
don't vote for permanent normal trading relations, it's like we're
saying, well, they may be in there, but we're not going to treat them
like a member. And if we don't do that, what it means is, we don't get
the benefit of the deal I just described to you. That's what this is
all about.

This agreement, which we negotiated -- and it's self-serving for me
to say, I realize that, because it was negotiated by our trade
ambassador, Charlene Barshefsky, with heavy input from Secretary
Glickman and Gene Sperling, my National Economic Advisor, who was there
in China with her -- but it really is a hundred-to-nothing agreement
economically. Normally, when we negotiate a trade agreement, we swap
out, just like you do if you make a deal with somebody. Somebody says,
you know, I'll give you this, and you say, okay, I'll give you that.

This is not a trade agreement in that sense. This is a membership
agreement. They say, if you let us into this world trading unit, we'll
abide by the rules -- including rules that we weren't governed by before
-- and, in order to get in it, we'll agree to modernize our economy,
which means we will drop our tariffs, open our markets, let you sell
into our markets, let you invest in our markets. It is a huge deal.

If you look beyond agriculture, it used to be that if we wanted to
sell manufacturing products in China, they'd say, fine; put a plant
here. Or if we wanted to sell some high-tech products, they'd say,
fine; transfer the technology to us. Now -- that's one reason we have
representatives from 3M company here -- we'll be able to sell for the
first time into the Chinese market American cars, for example, without
putting up auto plants, without transferring the technology.

But nowhere will the benefits be greater than in agriculture.
You've already heard from Dallas that export subsidies have kept
American corn and other products from being priced competitively. No
more. No more baseless health barriers, which China uses, or has used,
to keep our beef and poultry outside their borders. No more high
tariffs on feed grains, soybeans, vegetables, meat and dairy products.
Indeed -- as Secretary Glickman reminds me from time to time when we
have problems with our European neighbors and friends -- the Chinese
have offered us lower tariffs on some farm products than the European
Union imposes today.

Now, China's going to grow no matter what we do. And they're going
to get into the WTO. The only issue here -- the only issue is whether
we are prepared to give up this annual review in return for the economic
benefits that we have negotiated. That is the decision before the
Congress. And it seems to me that it's a pretty easy decision. I think
if Congress turns its back on this opportunity, we'll spend the next 20
years regretting it. And I know we'll spend the next 20 years paying
for it, in ways that go far beyond dollars in farm families' pockets.

This is a vote for our economic security. China agrees to play by
the same trading rules we do, and if we don't like it, we have two
options. One is, we can pursue them in the world trading organization
mechanisms, which means it won't just be America against China, and they
won't be able to say, there are those big ugly Americans trying to take
advantage of us. It'll be us and everybody else who plays by the same
rules.

But in addition to that, you need to know that we negotiated an
agreement with China unlike any one we have with any other country,
which says that we can go against them bilaterally, us against them, if
they dump products in our market, or if for some reason, like changing
currency, there's an enormous surge of their products in our market
threatening to dislocate a lot of Americans. And they have agreed to
let us bring action with a lower standard for proof of injury than we
have in our own trade laws. Plus which, we have got money set aside to
monitor this agreement in greater detail than any one we've ever had.
So I think it's a pretty clear issue.

Now, why isn't everybody for it? Well, some people say, well,
maybe they won't keep their word. Well, we have trade disputes all the
time. We've got two outstanding with Europe still that haven't been
resolved, where we just keep running around. But you've got a better
chance of getting it resolved with people in a rules-based, law-abiding
international system than outside it.

Some people say, well, they still do a lot of things we don't like.
Well, that's true. But I can tell you that we'll have a lot more
influence on Chinese foreign policy, when it comes to the proliferation
of dangerous weapons, and on human rights and religious rights and
political rights in China, if we have an open hand of working with them,
than if we say no, if we turn our backs on them. I am absolutely
certain of that. (Applause.)

And I just want to point out, that is why all of our allies in
Asia, the democracies -- Japan, South Korea, the Philippines, Thailand
-- these countries want us to give them normal trading status. They're
very worried that we might not do this, and that it will increase
tensions in Asia, and increase the chance of something bad happening
between Taiwan and Japan, and make China focus more on military
build-ups than building their economy and their relationships with their
neighbors. That's why the President-elect of Taiwan wants us to approve
this.

That's why Martin Lee, who's the leader of the democracy movement
in Hong Kong -- a man prohibited by law from even going to China. If
anybody ought to have an axe to grind, you'd think he would. He came
here to America to tell the Congress they had to vote for this because
that was the way to get human rights and political freedom in China, to
put them in a rule-based system of international law.

Yesterday there was a detailed report in the Washington press
interviewing dissidents in China, people who have been persecuted for
their beliefs. Every one interview said, America has got to approve
this, otherwise America will have no influence to try to keep moving
China toward democracy and freedom.

You know, we get frustrated, but China is an old country and it's
changing fast. Two years ago, there were 2 million Internet users.
Last year, there were 9 million. This year there will be over 20
million. At some point, you tell me, when they get to 50 or 100 or 150
million -- which by then will still be barely more than 10 percent of
their population -- the country will change forever. You cannot
maintain top-down control.

And I think it might be interesting for you to know that no
everybody in China wants us to do this. You know who is against it in
China? The most reactionary elements in the military and the people
that run those old, uncompetitive state-owned industries that want to
keep those subsidies coming, that want to keep these markets closed and
that want to keep their thumb on the little folks in China.

Look, this may or may not work out. I can't tell you what the
future will hold. Nobody knows that. And the Chinese will have to
decide what path they take to the future. All I know is, this is a good
economic deal and it's an imperative national security issue, because we
ought to at least get caught trying to give every chance to the Chinese
to take a responsible path to tomorrow, to have a constructive
relationship with this country when our children are grown, when our
grandchildren are in school. We don't want a new arms race. We don't
want every mutt in 2010 or 2020 to be calculating -- see the papers full
of stories about whether we're calculating whether we've got enough
nuclear missiles against the Chinese.

We ought to give this a chance. We ought to give the future a
chance to work. It's a great deal for you now. But as much as I want
to help the farmers here, and the farmers home in Arkansas -- so when I
go home they'll still let me come around -- (laughter) -- it's far more
important to me to do the right thing by our national security, to give
our children a chance to live in the most peaceful world in human
history.

And that's what this is all about. So I hope you will support
David Minge. I hope you will ask your senators to vote for this. I
hope you will ask the other members of the Minnesota delegation to vote
for this. And I hope you will tell people that it is clearly the right
thing to do economically. It is clearly the next logical step from the
historic news made in the Carter-Mondale administration in 1979.

But the most important thing is, it gives us a chance to build the
future of our dreams for our children. People ask me all the time, now
that you've been President seven years, what have you learned about
foreign policy? And I always tell them, it's a lot more like real life
than you think. And nine times out of ten, you get a lot more reaching
out a hand of cooperation than you do shaking a clenched fist. That's
what this is about. (Applause.)

Now, if they do something that's terrible that we're offended by,
we don't give up a single right here to suspend our trade relations or
do anything else that any emergency conditions might dictate. All we're
doing is saying, we'd like to build a future with you if you're willing
to do it. And we're prepared to work over the long run.

I thank you for coming here today. I ask you to recognize that
this is not a foregone conclusion. I believe it is by far the most
important national security vote that Congress will cast this year. And
if you can do anything as an American citizen, as well as Minnesota
farmers, to help us prevail, you'd be doing a great thing for our
grandchildren.